The Reserve Bank of India ("RBI"), has issued notification dated August 03, 2017, pursuant to which it has decided that it will continue not to issue letter of credits ("LC") on behalf of government and will not act as an issuing or advising bank for government as far as transactions related to bank guarantees ("BG") are concerned. The role of RBI shall be strictly limited to reimbursement of payments made by the banks for such LCs/BGs on behalf of the government, after satisfying itself with the debit mandate given by the government.
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